Assignment Details:

The Irish government must respond to the severe economic downturn caused by the COVID-19 pandemic; such a response may act to stimulate the economy or promote living within our means as set out by the theories of Keynesian Economics and Economic Liberalism respectfully.

Compare and contrast these different potential responses in at least four sectors of the Irish economy.

Learning outcomes:

LO2. Explain the broad principles of macroeconomics and the role of government intervention

LO3. Describe the main features of the Irish economy

LO4. Interpret standard economic models of the market and of market intervention

In your answer you should:

1. Describe the Irish economy using the circular flow of income;
2. Briefly outline the theories of economic liberalism and Keynesian economics;
3. Use the model of demand and supply to explain how markets work;
4. Discuss and describe how international trade can affect an economy’s potential output;
5. Debate the role of the welfare state;
6. Analyze potential labor market changes;
7. Analyze any potential trade-off between unemployment and

Your answer should have an introduction, main body, and conclusion. While some attention of your answer should be focused on the theoretical definition, the main focus of your answer should concentrate on the extent to how the state may act and the economic arguments both for and against these actions by using the course material and external evidence such as CSO data.

It is important that you answer the question directed at you. In essence, the question is seeking a response to contrasting arguments around government intervention in the Irish economy. Your answer should be a well-balanced economic argument identifying the various options open to the government.

Diagrams, tables, graphs, and their descriptions are to be attached as appendixes and are excluded from the overall word count, you should reference them in your answer.

Your answer must contain a reference list in a separate section at the end of your answer. References and the reference section are also excluded from the word count.